In a letter to British Foreign Secretary Arthur Balfour, Sir Maurice Hankey, Britain’s First Secretary of the War Cabinet, writes, “Oil in the next war will occupy the place of coal in the present war, or at least a parallel place to coal. The only big potential supply that we can get under British control is the Persian [now Iran] and Mesopotamian [now Iraq] supply… Control over these oil supplies becomes a first class British war aim.” [Yergin, 1993; Muttitt, 2005]

About 500 Iranian students take over the American Embassy in Tehran and hold 52 Americans hostage for 444 days. The Mujahedeen-e Khalq (MEK) is one of the groups that supports the take-over. [US Department of State, 4/30/2003; PBS, 1/15/2006]

The Mujahedeen-e Khalq (MEK) is expelled from Iran and takes refuge in Iraq. In exile, the group develops an overseas support structure and creates the National Liberation Army (NLA), which acquires tanks, armored vehicles, and heavy artillery. The group will receive support from Saddam Hussein until he is toppled by a US invasion in 2003 (see March 19, 2003). [US Department of State, 4/30/2003]

Israel secretly changes its policy towards Iran, and now seeks a level of rapprochement with that nation. Israeli defense minister Ariel Sharon proposes that President Jimmy Carter, who is struggling to find a diplomatic means to get the 52 American hostages released, begin secretly selling US arms to Iran. Carter angrily refuses. But unbeknownst to Carter, Israel will begin selling its own arms to Iran shortly thereafter. Interestingly, some officials in the US State Department and the CIA know of the Israeli arms sales to Iran. [New Yorker, 11/2/1992]

Nabih Berri in 1982. [Source: Reza / Corbis]Nabih Berri takes over the Amal Militia, a Shi’a Lebanese paramilitary organization, and tries to build it up as a power base for himself. Although not a fundamentalist Muslim, Berri allies himself with the new regime in Iran and Hezbollah, a fundamentalist Lebanese Shi’a party backed by Iran. Berri also manages to convince Syrian authorities that he will represent their interests in Lebanon and comes to a similar arrangement with the Ba’ath party in Iraq. This is a difficult balance for Berri to keep, as journalists Joe and Susan Trento will later point out, “If he displeased the Iranian mullahs who controlled the supply of money to Hezbollah in Lebanon, he would lose his grip on power.” Former intelligence officer Michael Pilgrim will comment, “Berri was targeted for CIA recruitment and so were members of his militia… I think it’s safe to say we financed his early trips to Iran.” He also commences relationships with the Drug Enforcement Agency and Defense Intelligence Agency. Unsurprisingly, some of the consequences of this are bad for the US, and the Trentos will comment: “The relationship would end in a series of deadly disasters for members of our armed services and the CIA. According to US intelligence officials who served in Lebanon at the time, Berri kept the peace with [Iran] and the Shi’a by allowing them to attack Westerners in his Amal-controlled territory. To prove his loyalty to the Shi’a and keep the alliance that was essential to his power base, he failed to pass on intelligence to the United States.” Based on interviews with former intelligence officers and associates of Berri, the Trentos will conclude that he facilitated attacks on the US by Hezbollah by allowing their operatives to pass Amal checkpoints without warning the US, for example before attacks on the US embassy and Marine barracks in 1983 in which hundreds die (see April 18-October 23, 1983). [Trento and Trento, 2006, pp. 74-77]

Shatt al-Arab waterway. [Source: CNN]Iraq invades Iran, officially beginning a nine-year war between those two countries, though Iraq insists that Iran has been launching artillery attacks against Iraqi targets since September 4. The overarching reason, according to Iraqi dictator Saddam Hussein, is over control of the Shatt al-Arab, the geographically critical waterway between Iran and Iraq that empties into the Persian Gulf. (Iraq signed over partial control of the Shatt al-Arab to Iran in 1975, but reclaimed the waterway in 1979 after the fall of Iran’s Shah Reza Pahlavi; Iraq also has hopes to conquer the oil-rich Iranian province of Khuzestan.) The United States will provide covert military support to both Iran (see November 3, 1986) and Iraq (see 1981-1988) during the war. [Infoplease, 2007]

Iran conducts a limited air strike against Iraq’s Osirak nuclear reactor, after being publicly exhorted to do so by Israel’s chief of Army intelligence. The Osirak reactor is at the same site as the Iraq Nuclear Research Center, in al-Tuwaitha, where Israeli intelligence believes the first Arab atomic bomb will be assembled. The strike is part of a larger strike by Iran against a conventional electric power plant near Baghdad. The strike inflicts only minor damage, and the plant is quickly repaired and brought back online. Iran will not conduct any further air strikes against Iraqi nuclear facilities throughout the entire Iran-Iraq War. In fact, it is not clear whether the Iranian strike is a pre-planned bombing raid by Iranian war planners, or an air strike by two pilots with a chance at a target of opportunity. [New Yorker, 11/2/1992; Institute for National Strategic Studies, 5/1995] In June 1981, Israel will obliterate the Osirak facility (see June 7, 1981).

F-14 spare parts shipped to Iran. [Source: Reuben Johnson / Weekly Standard]Israeli officials secretly ask Reagan administration officials for authorization to transfer arms of US origin to Iran. Officials in the Departments of Defense and State have known of Israeli arms sales to Iran that predate Reagan’s installation as president and the freeing of the American hostages, and since Reagan’s ascension to power, plans for US arms sales to Iran have been in the works (see January 28, 1981). Secretary of State Alexander Haig tells Israel that it is acceptable “in principle” for Israel to sell only F-4 fighter plane parts, and the US must approve specific arms-sales lists in advance. It shortly becomes evident, according to State Department documents leaked years later to the press, that Israel is not submitting lists for approval, and is selling US-made arms to Iran far in excess of spare parts for a specific model of fighter jet. (By the mid-1980s, officials will acknowledge that several billion dollars’ worth of ammunition and parts worth would flow from Israel to Iran each year.) Little oversight is exercised on the arms sales; one US ambassador to the region will say in 1992, “[I]t is probable that those who were to serve as their proxies—Israel and private international arms dealers—had agendas of their own, and the end result was that more arms were shipped than anyone in the administration wanted.” The Israeli arms transfers also violate the Arms Export Control Act, which requires written permission from the US for a nation to transfer US-made arms to a third party, and requires the president to immediately inform Congress when such transfers take place. [New Yorker, 11/2/1992]

Alexander Haig. [Source: Wally McNamee / Corbis]The newly installed Reagan administration publicly maintains a hard line against Iran, a nation vastly unpopular among Americans who have not forgiven that nation for holding 52 of its citizens hostage for well over a year and murdering a CIA station chief. (Years later, Vice President Bush will call it “an understandable animosity, a hatred, really,” and add, “I feel that way myself.”) President Reagan’s secretary of state, Alexander Haig, says bluntly, “Let me state categorically today there will be no military equipment provided to the government of Iran.” Yet within weeks of taking office, Reagan officials will begin putting together a continuing package of secret arms sales to Iran. [New Yorker, 11/2/1992]

According to investigative journalists Joe and Susan Trento, the arrest of former CIA agent Edwin Wilson, who was involved in business dealings with Libya, has serious consequences for US terrorism policy: “Throughout the 1980s the United States used its intelligence services to divert blame from Iran and Hezbollah onto Libya as part of its entanglement in Iran-Contra with the so-called moderate Iranians with whom the Reagan administration dealt. Ever since international arms dealer Edwin Wilson had been captured and imprisoned in the early 1980s, American intelligence and the White House had labeled Libya a rogue nation, and Libyan dictator Mu’ammar al-Qadhafi a terrorist leader. The intelligence operation went so far that the United States actually recruited a gang of Lebanese criminals to pretend to be a cell of Libyan-backed terrorists conducting violent acts around the world.… These activities, all choreographed by the CIA, were fed to allies such as West Germany as authentic intelligence that implicated Libya for terrorists acts that were either fake or were, in reality, authorized by Iran and carried out by Hezbollah and other surrogate groups.” Benefit to Iran - This policy apparently benefits Iran: “The Reagan administration had given the Iranians plenty of cards to play. The biggest card was the help it had provided making Libya seem like the ultimate source of all terrorist acts.… When the Reagan administration turned Libya into a vicious terrorist nation operating throughout Europe, that gave Iran the perfect opening for retribution.” No action against Hezbollah - In addition, it prevents the US from taking action against Hezbollah, even though Hezbollah is killing Americans: “Because of the Iran-Contra scandal—the selling of weapons to Iran to fund the war in Central America—the Reagan administration ended up protecting Iran’s number one terrorist proxy, Hezbollah, while at the same time Hezbollah’s terrorists were killing and kidnapping hundreds of Americans. While secretly working with the Iranian government, the Reagan administration manipulated intelligence to blame Libya for terrorist attacks for which Hezbollah was responsible. During the 1980s Hezbollah killed and terrorized hundreds of Americans in Beirut, bombing the US Marine barracks, blowing up the CIA station, and killing State Department employees in a bomb attack on the US embassy. Hezbollah did all this with the help of local militia leaders whom the United States relied on as its secret conduits to Iran for its sale of weapons.” [Trento and Trento, 2006, pp. xvi, 64-5]

CIA agent Robert Baer proposes a series of false flag attacks in Europe to drive a wedge between Syria and Iran, which he hopes will lead to the freeing of Western hostages held in Lebanon. Although his superiors ban the use of real explosives, the proposal is implemented in altered form. Baer is aware that the current secular Syrian government is nervous about the tendency of Iran, one of its allies, to support numerous Islamic movements, including ones generally opposed to Syria. He plans to make the Syrians think that Iran has turned against it by carrying out a series of car bombings against Syrian diplomats in Europe and then claiming them in a statement issued by the CIA pretending to be the Lebanon-based and Iran-backed terror group Hezbollah. Baer thinks that Syria would then break with Hezbollah and the hostages would be freed. Although the plan is for the bombs to misfire and the diplomats not to be killed, his superior says that the use of any bombs in Europe is beyond the pale for the CIA. Baer will later comment: “Eventually we did get an operation through the bureaucracy. The CIA has asked me not to describe it. I can say, though, that while it managed to irritate [Syrian president] Hafiz al-Asad—sort of like a twenty-four hour diaper rash—it wasn’t enough for him to shut down Hezbollah.” [Baer, 2002, pp. 140-2]

Graham Fuller. [Source: Ohio University]The US tilts ever more sharply towards Iraq in the Iran-Iraq war, even though the Reagan administration continues to maintain a posture of overt neutrality in the conflict. The administration has provided covert military aid for both sides in the struggle (see 1981 and October 1983), and has been divided over which regime to support (see January 14, 1984). It is already involved in “Operation Staunch,” a program designed by Secretary of State George Shultz to stem the flow of weapons to Iran. Now, some officials are arguing that it is time to reverse that course. Graham Fuller, the CIA’s national intelligence officer for the Middle East, writes two controversial secret memos advocating that the administration begin providing support for Iran against Iraq. Fuller is presenting a position long held by national security director Robert McFarlane and two of McFarlane’s aides, Oliver North and Howard Teicher. This pro-Iran group has recently been joined by CIA director William Casey. Both McFarlane and Casey are supportive of Fuller’s memo. Fuller writes in a May 17 memo, “Our tilt to Iraq was timely when Iraq was against the ropes and the Islamic revolution was on a roll. The time may now have to come to tilt back.” Fuller argues that the US should once again authorize Israel to ship US arms to Iran. Ironically, this is the mirror image of Defense Secretary Caspar Weinberger’s argument in favor of supporting Iraq: the US must counter one covert policy with another (see Early 1982). The pro-Iranian coalition within the administration gives scant consideration to the hostage-taking of seven Americans by Hezbollah, a Lebanese Shi’ite militant group with strong ties to Iran’s theocratic regime. On May 20, Fuller circulates a second memo, called a “Special National Intelligence Estimate” (SNIE), that is only read by a handful of senior White House officials (Ronald Reagan is one of the recipients; George Bush is not). Fuller’s memo is written almost entirely for Reagan’s benefit, and in its arguments, becomes a basis for renewed arms sales to Iran and the resulting Iran-Contra scandal. Fuller evokes one of Reagan’s favorite themes, the trouncing of the Soviet Union in the global arena: “We know that the USSR views Iran as ‘the prize’ in the Gulf. Moscow will improve relations when and where it can… until it gains major influence in that state. The disturbing possibility is that the USSR is far more likely than the US to be first in finding opportunities to improve its ties to Iran.” Interestingly, in 1991, during Robert Gates’s Senate hearings on becoming the director of the CIA, it is learned that Fuller’s memo contradicts the views of career Soviet analysts at the agency, who believe that the Soviet Union has no real hope of making inroads into the Iranian regime. The USSR is the chief arms supplier for Iraq, Iran’s bitter enemy and current opponent in a long and bloody war. Iran is arming the Afghan mujaheddin, the Islamist resistance fighters viewed as a threat by Saddam Hussein. Several CIA analysts will later testify that they believe Fuller deliberately slanted his memo for political reasons. In 1992, Fuller himself will admit that he was wrong, but will deny any politicization. Regardless, Fuller’s memo becomes a critical document shaping the Reagan policy to arm Iran. It is not clear whether Vice President Bush ever saw the memo, but whether he did or not, beginning in 1985 he takes part in numerous White House meetings where the arming of Iran is discussed. If he has objections to the policy, he never voices them. [Time, 11/17/1986; New Yorker, 11/2/1992]

Tensions between the pro-Iran and pro-Iraq factions in the White House (see January 14, 1984) come to a head after Robert McFarlane’s National Security Council staff drafts a presidential directive advocating that the US help Iran obtain weapons. The opposing faction, led by Secretary of State George Shultz and Defense Secretary Caspar Weinberger, protest angrily, with Weinberger calling the proposal “almost too absurd to comment on….” But the arms-for-hostage deal will go forward over Shultz’s and Weinberger’s objections (see July 3, 1985). [New Yorker, 11/2/1992]

David Kimche. [Source: Mark Leighton / Bettmann / Corbis]David Kimche, the director general of Israel’s Foreign Ministry, meets secretly with National Security Adviser Robert McFarlane to advise him that Israel may be able to use its influence with Iran (see 1981) to engineer the release of American hostages currently held by Hezbollah. Kimche’s outreach is the final piece in the complex arms-for-hostage deal between the US, Israel, and Iran. [New Yorker, 11/2/1992] Israel is a logical conduit for arms to Iran, as it has been selling arms to Iran periodically since 1979, originally as part of its efforts to get Iran to allow Iranian Jews to emigrate to Israel. Like the US, Israel hopes to gain influence with Iranian moderates who will presumably take power after the aged, ailing Islamist radical Ayatollah Ruhollah Khomeini dies. (Earlier attempts to sell US-made arms to Iran had been blocked by the Carter administration.) According to Israeli sources, this Israeli offer began with a group of Israeli businessmen informing Prime Minister Shimon Peres in early July that they had been in contact with Iranian officials, and thought they could facilitate an arrangement to swap US arms for American hostages. The Israelis say that the US point man for the deal is John Poindexter, the deputy national security adviser, and Poindexter tapped National Security Council aide Oliver North to be the US liaison to Israel. Peres quickly authorized the Israeli businessmen to resume their contacts with the Iranians, and the businessmen contacted Saudi arms merchant Adnan Khashoggi. Khashoggi obtained a long list of desired military equipment from the Iranians, including Hawk antiaircraft missiles and radar-guidance equipment for them, antitank missiles, and spare parts for jet fighters. [Time, 11/17/1986]

After Hezbollah takes two more Americans hostage in Lebanon, Ronald Reagan angrily charges that Iran (the sponsor of Hezbollah) is a member of what he calls a “confederation of terrorist states… a new, international version of Murder Incorporated.” He asserts, “America will never make concessions to terrorists.” But unbeknownst to the public, a group of senior White House officials are working to begin providing military aid to Iran (see May 1985). [New Yorker, 11/2/1992]

A major meeting to codify the arms-for-hostage deal with Iran takes place in Ronald Reagan’s private White House quarters, after Iranian officials sent requests to open negotiations with the US through backchannel sources. Reagan, recovering from intestinal surgery and wearing pajamas and a bathrobe, is joined by Vice President Bush, Secretary of State George Shultz, Defense Secretary Caspar Weinberger, White House chief of staff Donald Regan, and National Security Adviser Robert McFarlane. McFarlane, passing along information he has received from Israel (see 1981), says the Iranians will see to it that Hezbollah releases four American hostages in return for US and Israeli arms. McFarlane has long supported arms sales to Iran, and is most supportive of the deal; Weinberger and Shultz, who support dealing with Iraq, are firmly against it. But the deal will go through (see September 15, 1985). [Time, 11/17/1986; New Yorker, 11/2/1992]

Benjamin Weir. [Source: Santa Clara University]The first arms-for-hostage deal between Iran and the US is completed (see August 6, 1985). On August 30, Israel sold over 500 US-made TOW anti-tank missiles to Iran. Now Iran frees the Reverend Benjamin Weir, an American kidnapped over a year before in Lebanon. White House officials hope for further hostage releases, but none are forthcoming. [New Yorker, 11/2/1992] Ronald Reagan will telephone Israeli Prime Minister Shimon Peres to thank him for Israel’s help in securing Weir’s freedom. The TOW missiles will be delivered to Iran on September 20, in the cargo hold of a DC-8 transport plane once owned by a Miami-based air transport company; the aircraft took off from Tabriz, Iran, disappeared from radar screens over Turkey, made what was supposed to be a “forced landing” in Israel and later returned to Iran by a circuitous route. [Time, 11/17/1986]

Defense Secretary Caspar Weinberger, who has opposed the arms-for-hostage deal with Iran from the outset, warns President Reagan that the arms transfers are patently illegal under the Arms Export Control Act (see 1981). Weinberger later says, “There was no way in which this kind of transfer could be made if that particular act governed.” According to Secretary of State George Shultz, who is also present, Reagan answers, “Well, the American people would never forgive me if I failed to get these hostages out over this legal question.” [New Yorker, 11/2/1992]

John Poindexter. [Source: US Navy]In a meeting between President Ronald Reagan, Vice President George Bush, Secretary of State George Shultz, Secretary of Defense Caspar Weinberger, CIA Director William Casey, and new National Security Adviser John Poindexter, the participants discuss whether to sell 4,000 Israeli-owned, US-made antitank missiles to Iran as another arms-for-hostages deal (see September 15, 1985). Shultz and Weinberger, as they have before, oppose any dealings with Iran. Bush, according to records of the meeting, fails to express any views at all, but Shultz will recall Bush supporting the deal. In 1988, Bush will tell a reporter that he doesn’t remember any such conflict over the arms sales, saying, “I never really heard them that clearly. And the reason is that the machinery broke down—it never worked as it should. The key players with the experience weren’t ever called together… to review the decisions that were made at a lower level.” It is hard to imagine any higher levels of the executive branch of government than what is represented in this meeting. In 1987, Bush will tell the Tower Commission investigating the deal that he didn’t know enough about the arms-for-hostages deals to be able to express an informed opinion about the decision to make the deals, and doesn’t remember the meeting as a “showdown session,” testimony contradicted by both Weinberger and Shultz in their own statements to the commission. [New Yorker, 11/2/1992]

Albert Hakim. [Source: Bettmann / Corbis]During a morning intelligence briefing, President Ronald Reagan signs the authorization for the US to allow Israel to sell Iran 4,000 US-made antitank missiles (see January 7, 1986). As they have consistently done before, Defense Secretary Caspar Weinberger and Secretary of State George Shultz register their opposition to the arms deals with Iran. National Security Adviser John Poindexter notes in a February 1986 e-mail that Vice President George Bush supports the arms-for-hostages deals with Iran, writing that the “President and VP are solid in taking the position that we have to try.” The reasons the various administration officials have for agreeing to sell arms to Iran are complex. Reagan is motivated by his belief that supporting Iran thwarts Soviet plans for Middle East domination (see May 1985), and by his own personal sorrow over the plight of the hostages. Others have more overtly political motives primarily fueled by the upcoming midterm elections. If, as in 1980, the American hostages currently held by Islamist radicals can be freed before the elections, the Republicans would likely reap the political benefits. Iranian-born arms merchant Albert Hakim, who is involved in the arms deals, will later tell Congress’s Iran-Contra committee, “We had to meet a deadline in releasing hostages, because the elections were coming up.” Even National Security Council aide Oliver North, one of the chief facilitators of the deals with Iran, will admit to the committee, “There are political concerns.” The US insists that before it deliver any of the antitank missiles, all of the hostages must be released. Iran refuses, and a deadlock ensues that will last for months. [New Yorker, 11/2/1992]

Robert McFarlane. [Source: Shelly Katz / Time Life / Getty Images]A delegation secretly sent to Iran by the White House to break the arms-for-hostages deadlock (see November 3, 1986) returns to Iran. The two countries have been at an impasse since January, when President Reagan authorized the sale of 4,000 antitank missiles to Iran but US officials insisted that all of the American hostages held by Hezbollah be freed before the missiles would be delivered, a condition the Iranians have refused (see January 17, 1986). The US delegation—actually the third such delegation to secretly visit Tehran—includes former National Security Adviser Robert McFarlane; McFarlane’s longtime supporter and current National Security Council member Oliver North; CIA expert George Cave; and North’s NSC colleague, Howard Teicher. Israel, which will facilitate the arms transfer, sends Amiram Nir, a counterterrorism adviser to Prime Minister Shimon Peres. [Time, 11/17/1986; New Yorker, 11/2/1992] McFarlane and North bring with them more spare parts for Iran’s Hawk anti-aircraft missiles. They attempt, and fail, to persuade the Iranians to facilitate the release of all American hostages. [New York Times, 11/19/1987] The delegation’s mission has borne no fruit, as the Iranians insisted on “sequencing,” or releasing the hostages two at a time as arms shipments were delivered. Part of the problem surrounds the Iranians’ belief that they are being charged outrageous prices for the missiles, a perception given credence by the fact that profits from the weapons sales are being used to fund Nicaragua’s Contra rebel movement. [Time, 11/17/1986; New Yorker, 11/2/1992]Unusual Negotiation Tactics - Part of the negotiations involves North, the NSC staffer who coordinates the administration’s dealings with the Contras, offering the Iranians a Bible signed by President Reagan and a chocolate cake. In response, the Iranians stall. Hezbollah will release a few US hostages and take others hostage, maintaining the status quo. [Dubose and Bernstein, 2006, pp. 65]Explicit Briefing of President, Vice President - McFarlane later briefs both Reagan and Vice President Bush on the arms-for-hostage negotiations (see May 29, 1986).

Vice President Bush meets with several national leaders during his trip to the Middle East (see July 28-August 3, 1986). Ostensibly Bush is visiting the region to “advance the peace process,” but in reality his trip has three reasons: to raise his own public profile as an experienced hand in foreign relations for his upcoming presidential bid, to negotiate for the release of US hostages held by Iran, and to secretly pressure Iraq to increase its bombing of Iran to aid in those negotiations. Meeting with the Israelis - Bush meets briefly with Amiram Nir in Jerusalem. Nir, a close friend of Oliver North’s and a counterterrorism adviser to Israeli Prime Minister Shimon Peres, meets with Bush at North’s behest. Bush will later characterize his meeting with Nir as “generally about counterterrorism,” and will admit obliquely that the two did have “some discussion of arms sales as a means to ‘reach out to moderate elements’ in the Iranian government. Arms sales would ‘establish bona fides’ with the moderate element, who ‘might use their influence with the people who were holding the hostages.’” However, the meeting is later described very differently by others, including Craig Fuller, Bush’s chief of staff, who is present at the meeting; according to Fuller, the two discuss the arms-for-hostages deal in great detail, including specifics about what arms will be delivered, and both are ready to negotiate with the Islamic radicals of the Khomeini regime who control the American hostages. The hostages are to be released in a group in return for 4,000 US-made antitank missiles. Nir himself reports the contents of the meeting to Peres, and his later account of it is virtually identical to Fuller’s. Nir also notes that his biggest question—how to get the Iranians to release the hostages all at once and not one or two at a time—went unanswered by Bush. “The [vice president] made no commitments nor did he give any direction to Nir,” Fuller notes. Meeting with King Hussein - Bush then flies to Jordan to meet with King Hussein. Their meeting has an element not divulged to the press: Hussein has often been used as an intermediary between Reagan officials and Iraq. The CIA uses Jordan as a conduit to pass intelligence to Iraq, with the Jordanian involvement providing critical “deniability.” Bush tells the king that Iraq needs to be more aggressive in its war with Iran if it wants to win the war, and tells Hussein to tell the Iraqis to use its air force more expansively. Hussein promises to pass the message along. Meeting with Mubarak - Bush then jets to Egypt to meet with its president, Hosni Mubarak. Reporters note that Bush tells Mubarak that the US cannot increase aid to Egypt. They are unaware that Bush asks Mubarak to pass along the same message that he has asked of King Hussein: to exhort Iraq to step up its air war against Iran. By the time Bush speaks with Mubarak, the NSA, monitoring Jordanian-Iraqi communications, learns that Hussein has already passed along the message. The talking points for Bush’s meeting with Mubarak are authored by Teicher. [New Yorker, 11/2/1992; Affidavit. United States v. Carlos Cardoen, et al. [Charge that Teledyne Wah Chang Albany illegally provided a proscribed substance, zirconium, to Cardoen Industries and to Iraq], 1/31/1995 ; MSNBC, 8/18/2002]

Vice President Bush, secretly planning to ask Iraq to increase its bombing of Iran in order to give the US more leverage in its hostage negotiations with Iran (see July 23, 1986), leaves for the Middle East on July 28. The trip is given a public face as an attempt by Bush to, as he tells reporters, “advance the peace process.” His political handlers, already thinking about the 1988 presidential elections, want to increase his public stature as a potential world leader. Bush is accompanied by his wife Barbara, a platoon of reporters, and a television crew hired by his political action committee to document the trip for future campaign purposes. But his staffers play down the possible impact of the trip. “This is not a trip designed to establish new breakthroughs,” says one Bush adviser. “It’s like tending a garden. If you don’t tend the garden, the weeds grow up. And I think there are a lot of weeds in that garden.” Much of the trip, such as the visit to Jordan, is planned primarily as a series of photo opportunities, with Bush’s PR team even exhorting the Jordanians to feature camels in each shot (camels are few in Jordan). Hostage Break - Bush learns while still in flight that an American hostage, the Reverend Lawrence Jenco, has just been released by his Hezbollah captors, most likely at the behest of the Iranians (see January 8, 1985). Jenco’s release, according to reporters Murray Waas and Craig Unger, is “a measure of Iran’s deep ambivalence about the negotiations. Iran need[s] weapons and [does] not want the deal to die. At the same time, the Iranians [a]re apoplectic because, according to their estimates, they were being overcharged by six hundred per cent [for US weapons], and they had not yet received parts for two hundred and forty Hawk missiles.” Jenco’s release is in return for the US expediting the shipment of the missile parts. [New Yorker, 11/2/1992; Affidavit. United States v. Carlos Cardoen, et al. [Charge that Teledyne Wah Chang Albany illegally provided a proscribed substance, zirconium, to Cardoen Industries and to Iraq], 1/31/1995 ; MSNBC, 8/18/2002]Effectiveness of the Message - Bush meets with several regional leaders, including Egypt’s Hosni Mubarak (see July 28-August 3, 1986). In the 48 hours following the meeting with Mubarak, Iraq launches 359 air strikes against Iran, including numerous strikes far deeper into Iran than it has done before. Apparently the message was effective. In return, while Bush is still “advancing the peace process,” the CIA begins providing the Iraqis with highly classified tactical information about Iranian military movements and strike targets. Evidently Iraq’s Saddam Hussein, previously suspicious of US motives and advice, felt more confident in the battle strategies advocated by such a high-level US official. When Bush returns to Washington on August 5, he is debriefed by Casey. According to one Casey aide, “Casey kept the return briefing very close to his vest. But he said Bush was supportive of the initiative and had carried out his mission.” [New Yorker, 11/2/1992]

Richard Secord. [Source: Bettmann / Corbis]Ali Hashemi Bahramani, a high-ranking officer in the Iranian Revolutionary Guards, meets secretly with NSC official Oliver North. Bahramani has a shopping list of arms Iran wants to buy from the US, particularly weapons and other material to defend the country against the recent escalation of Iraqi air strikes (see July 23, 1986). The plan to force Iran to trade US hostages for arms (see July 23, 1986) seems to be working. But for the US the plan has a fatal flaw: as hostages are released, Hezbollah, the Lebanese militant group controlled by Iran, simply kidnaps more Americans (see September 9-12, 1986). North’s assistant, Richard Secord, later states that it is evident the Iranians negotiating the release of the hostages are the same ones responsible for ordering the new kidnappings. But North, his boss John Poindexter, and CIA Director William Casey continue with the Iranian initiative regardless. One driving factor, Secord will note, is that by this point, $3.8 million in profits from the Iranian arms sales has been diverted to the Nicaraguan Contras. [New Yorker, 11/2/1992]

The Danish Union of Seamen claims that Danish cargo ships have carried at least five loads of arms and ammunition from Israel to Iran. The union’s deputy chairman, Henrik Berlau, says, “It appears that the shipments this year have been carried out on the orders of the US to win the release of hostages in Lebanon.” Danish cargo ships have the reputation of being able to deliver questionable cargo quietly to most parts of the world. Berlau tells the story of an October voyage, where a Danish cargo ship picked up 26 containers of ammunition from the Israeli port of Eilat and delivered them to the Iranian port of Bandar Abbas. A Danish sailor told Berlau, “We all knew there was ammunition on board.” But Israeli authorities in Eilat kept the nature of the cargo secret: “The Israeli harbor authorities told us to take off all markings that could show we had been in Israel, including the markings on the food we had taken aboard and on the weapons containers. We even had to remove the JAFFA markings on the oranges.” Uniformed Israelis, said the Danish seaman, forced the cargo ship to temporarily change its name (from Morso to Solar) until the ship reached the Persian Gulf on October 21, just before it delivered its cargo. [Time, 11/17/1986]

David Durenberger. [Source: NNDB.com]According to his 1988 campaign biography Looking Forward, Vice President Bush is briefed on the Iran-Contra operation by Senator David Durenberger (D-MN), the chairman of the Senate Intelligence Committee. Until this briefing, Bush will claim, he knew nothing of the substance of the operation. He leaves the briefing feeling that he had “been deliberately excluded from key meetings involving details of the Iran operation” and “not in the loop.” He also denies playing any role in arming Iraq, in the murky, little-understood operation commonly known as “Iraqgate.” Evidence disproves Bush’s claims of ignorance (see July 23, 1986). [New Yorker, 11/2/1992]

Faced with revelations of his possible involvement in the Iran-US arms-for-hostage deals (see November 3, 1986), Vice President George Bush, who has been heavily involved in the deals both with Iran and with its enemy Iraq (see July 23, 1986), denies knowing anything about anything. He tells the press that he knew nothing about any administration officials objecting to selling arms to Iran: “If I had sat there, and heard George Shultz and Cap [Caspar Weinberger] express it strongly, maybe I would have had a stronger view. But when you don’t know something it’s hard to react…. We were not in the loop.” Weinberger, the Secretary of Defense, telephones Shultz, the Secretary of State, and snaps, “He was on the other side [supporting the arms deals with Iran]. It’s on the record! Why did he say that?” Former National Security Council aide Howard Teicher, who was deeply involved in the arms-for-hostage deals with Iran, will say in 1992, “Bush definitely knew almost everything about the Iranian arms-sales initiative. I personally briefed him in great detail many times. Like so many others, he got premature Alzheimer’s after the arms sales became public.” [New Yorker, 11/2/1992]

Claiborne Pell. [Source: Brown University]The Senate Foreign Relations Committee reports that the US faces a dire choice if Iran is victorious in its war with Iraq. The choice, the committee reports, is “between permitting Iran to dominate the West’s oil supply in the Persian Gulf, and direct US military intervention… .” The report warns that the US, having agreed to protect Kuwaiti shipping in the Persian Gulf from Iranian attacks, “seriously risks being drawn into war” against Iran, and notes that Gulf nations believe the US is siding with Iraq in the war, “and the expanded US naval presence is likely to invite more Iranian attacks of increasing severity.… American naval forces in the Gulf are now, in effect, hostage to Iraqi war policy.” The Senate is debating whether to invoke the 1973 War Powers Resolution, which requires Congress to either declare war in the region or withdraw funding for the US military presence in the Gulf. The Reagan administration opposes the move, and it is doubtful a majority in Congress will vote to invoke the resolution. The report calls the US policy of escorting Kuwaiti tankers “dangerously nebulous.” The Reagan administration agreed to protect the tankers after Kuwait threatened to turn to the Soviets for help if the United States refused. Most Gulf nations believe Kuwait’s threat to ask for Soviet help is nothing more than a “feint” to involve the US in the war; few believe Kuwait is serious about turning to the Soviets for assistance. The report says that although “the flow of oil is not in serious jeopardy,” “shipping in the gulf now appears less safe than before the US naval buildup began.” Iran has recently sown Gulf waters with mines, posing a threat to Kuwaiti and other shipping in the area. Interestingly, though the report is critical of Reagan administration policy in the Gulf, it does not recommend reversing course. The US cannot retreat from its promise to protect Kuwaiti shipping without risking “great cost to US credibility in the region.” Claiborne Pell (D-RI) says, “This report shows that the danger of a possible Iraqi collapse is greater than commonly understood, and that the perils for us in the Gulf are certain to increase.” The report notes that because of the White House’s secret arming of Iran (see 1981), Iraq faces the real possibility of defeat in the war, with potentially catastrophic results for the US. “US policy in the Persian Gulf has been shaped as much by a short-term desire to restore credibility lost in the Iran-Contra affair as by any careful assessment of US interests and objectives.” [Boston Globe, 10/19/1987; New Yorker, 11/2/1992]

Crew members monitor radar screens in the combat information center aboard the Vincennes. This photo was taken by a crew member in January 1988. [Source: Public domain]The USS Vincennes, a state-of-the-art Aegis guided missile cruiser patrolling the Strait of Hormuz in an effort to keep oil tankers safe from Iranian and Iraqi depredations, detects an Iranian aircraft apparently closing in on its position. The captain and crew of the Vincennes are aware of previous attacks on US ships and Kuwaiti oil tankers by Iranian gunboats, and know of the attack a year before on the USS Stark by an Iraqi fighter (see May 17, 1987 and After). Just a half-hour before, the Vincennes itself had fired on Iranian gunboats. Captain Will Rogers III has seven minutes to decide what to do about the aircraft, which he and his radar operators believe is most likely an Iranian F-14. Although the first transmission from the Iranian aircraft identifies itself as “commair”—commercial aircraft—the radio operator forgets to reset his receiver, and subsequently receives transmissions from Iranian military aircraft which he mistakenly attributes to the incoming aircraft. When the aircraft is nine miles away, Rogers fires two SM-2 surface-to-air missiles at the aircraft. At least one missile hits the plane, which is not a military fighter, but Iran Air Flight 655, a civilian Boeing 747 carrying 290 passengers. The missile slices the airliner in half; all 290 passengers, including 66 children, die. Though the international community is outraged, the White House and the Pentagon defend the Vincennes’s action. The UN Security Council will not condemn the attack, and President Reagan volunteers to pay compensation to the families. The Navy is embarrassed that in the first real military action from one of its new Aegis cruisers, it had shot down an unarmed civilian aircraft. An investigation proves that the aircraft had been well within a commercially designated flight path, and was not descending in a threatening manner, as was initially claimed by both Vincennes personnel and Pentagon officials. No disciplinary actions against Rogers or any of his crew are ever taken. During the 1988 presidential campaign, Vice President George H. W. Bush will frequently say of the incident: “I will never apologize for the United States of America. I don’t care what the facts are.” [New York Times, 11/9/1988; TomDispatch (.com), 5/3/2007; History (.com), 2008]

The Iran-Iraq war ends in stalemate after both sides reluctantly accept a UN-brokered peace agreement. The border between the two countries does not change. The war cost at least 1.5 million lives. The major arms supplier for Iraq was the Soviet Union, while France was the biggest supplier to Iran. The US covertly sold arms to both sides during the war, though towards the end of the conflict, the US, after its clandestine arms-for-hostage deals with Iran were exposed in the international press (see November 3, 1986), tilted towards Iraq (see Early October-November, 1986). The Iranian and Iraqi regimes will set about slaughtering their own dissidents after the war—the Iraqis primarily focusing on separatist Kurds and Iran-sympathetic Shi’ites, and the Iranians focusing on its leftist dissident population. [ZMag, 2/1990; New Yorker, 11/2/1992; Infoplease, 2007]

CIA covert operations manager Ted Shackley. [Source: nndb(.com)]Following the bombing of Pan Am flight 103 over Lockerbie, Scotland, the CIA is apparently worried that an investigation of the attack, which may have been conducted or assisted by Iran or one of its surrogates, will uncover dealings between the US and Iran. Journalists Joe and Susan Trento will comment: “To avoid criticism that the United States was doing business with terrorists should the secret negotiations with Iran [Iran-Contra, etc.] be exposed, the CIA participated in a bizarre campaign to divert blame for terrorist acts from Iran and Iran’s surrogate, Hezbollah, to Libya. If there was a comprehensive investigation into the Pan Am 103 tragedy, everything might be exposed. The major behind-the-scenes player in all this activity was the former number two man in covert operations at the CIA, Theodore G. Shackley.” [Trento and Trento, 2006, pp. 67]

The “Shanghai Five” is formed in Shanghai with China, Russia, Kazakhstan, Kyrgyzstan, and Tajikistan as its founding members.
Its purpose is to resolve old Soviet-Chinese border disputes between the countries and ease military tension in the border regions. An agreement titled “Treaty on Deepening Military Trust in Border Regions” is signed at this time. The five members are said to be bound together by mutual distrust of US hegemony in the region. [BBC, 6/21/2001; Jane's Intelligence, 7/19/2001; GlobalSecurity (.org), 7/4/2005] In early 2001 the group will morph into the Shanghai Cooperation Organization (see June 14, 2001).

Mark Burles authors a report for the RAND Corporation on the subject of recent Chinese policy toward Russia and Central Asia. The report notes that while “China’s relationships with the countries of Central Asia do not carry the same potential threat to US interests as its relationship with Russia does,” China’s support “for the extension of pipeline routes from Central Asia through Iran [does have] the potential to generate conflict between Beijing and Washington.” Burles says China’s “pledge to help construct a pipeline from Kazakhstan to the Kazakh-Turkmen border, with the goal of eventually extending through to an Iranian port… would run counter to the current US policy of denying Iran access to Central Asian oil.” [Burles, 1999]

The Shanghai Cooperation Organization logo. [Source: Shanghai Cooperation Organization]The Shanghai Five (see 1996) becomes known as the Shanghai Cooperation Organization (SCO) and expands to include Uzbekistan. [BBC, 6/11/2001] SCO member-states agree unanimously to take the organization to a “higher level” and expand its mission beyond the original objectives of resolving border disputes and dealing with Islamic separatists to include issues such as regional economic development, commerce, and investment. [Shanghai Cooperation [.org], 6/20/2005] Leaders of the organization’s member-states say they hope the SCO will counterbalance US dominance of world affairs. According to Chinese President Jiang Zemin, the organization will foster “world multi-polarization” and contribute to the “establishment of a fair and reasonable international order.” [Associated Press, 6/15/2001] During their meeting in Shanghai, members sign a letter of support for the Anti-Ballistic Missile (ABM) Treaty (see May 26, 1972), which the United States has said it wants to scrap to make way for a missile defense shield (see December 13, 2001). [BBC, 6/15/2001] SCO members say the defense system will have a “negative impact on world security.” [Associated Press, 6/15/2001] One Russian official at the meeting says the 1972 ABM Treaty is the “cornerstone of global stability and disarmament.” [BBC, 6/15/2001] China and Russia also discuss collaborating on a joint program to develop a radar system capable of tracking US F-117A stealth fighter planes. [CNN, 6/20/2001]

Ariel Cohen of the Heritage Foundation authors a report warning that recent agreements between Russia and China demonstrate that the two countries are “positioning themselves to define the rules under which the United States, the European Union, Iran, and Turkey will be allowed to participate in the strategically important Central Asian region.” Good Neighborliness, Friendship and Cooperation Treaty - The treaty, signed two days before, includes a commitment to pursue “[j]oint actions to offset a perceived US hegemonism.” Cohen says the treaty “should signal to the Western world that a major geopolitical shift may be taking place in the Eurasian balance of power.” Shanghai Cooperation Organization (SCO) - Cohen says the Shanghai Cooperation Organization (SCO), created on June 14 (see June 14, 2001), and consisting of Russia, China, and the Central Asian States of Kazakhstan, Kyrgyzstan, Tajikistan, and Uzbekistan, could undermine US influence in Central Asia. Military partnership - Cohen warns that the two counties are interested in boosting “each other’s military potential as well as that of other countries that pursue anti-American foreign policies.” They could encourage the proliferation of weapons of mass destruction in order to “force the United States to spread its resources thinly to deal with evolving crises in different regions simultaneously.” Russian and Chinese economic cooperation - There are “numerous projects for developing free economic zones along the Chinese-Russian border and an international port in the mouth of the Tumannaya river (Tumangan)….” The Russian and Chinese also plan to “cooperate in developing a network of railroads and pipelines in Central Asia, building a pan-Asian transportation corridor (the Silk Road) from the Far East to Europe and the Middle East.” Cohen's conclusion - Cohen urges US policy makers to “examine the changing geostrategic reality and take steps to ensure that US security and national interests are not at risk.” [Heritage Foundation, 7/18/2001]

The Wall Street Journal publishes an op-ed piece by neoconservative Eliot Cohen advocating the overthrow of the mullahs in Iran. Cohen writes: “First, if one front in this war is the contest for free and moderate governance in the Muslim world, the US should throw its weight behind pro-Western and anticlerical forces there. The immediate choice lies before the US government in regard to Iran. We can either make tactical accommodations with the regime there in return for modest (or illusory) sharing of intelligence, reduced support for some terrorist groups and the like, or do everything in our power to support a civil society that loathes the mullahs and yearns to overturn their rule. It will be wise, moral and unpopular (among some of our allies) to choose the latter course. The overthrow of the first theocratic revolutionary Muslim state and its replacement by a moderate or secular government, however, would be no less important a victory in this war than the annihilation of bin Laden.” [Wall Street Journal, 11/20/2001]

According to a later report by the Senate Intelligence Committee, Pentagon officials conceal potentially life-saving intelligence gleaned from Iranian agents. The report will find that in 2001, the officials, Larry Franklin and Harold Rhode, fail to pass along information gained from Iranian agents to US intelligence agencies, including reports that Iran has sent “hit squads” to Afghanistan to kill Americans. The findings will be based on information from highly unreliable sources: Iranian arms merchant Manucher Ghorbanifar and former Pentagon official Michael Ledeen, both of whom have often provided false or questionable information gathered from questionable sources (see April 3, 2005). In a series of meetings authorized by then-Deputy National Security Adviser Stephen Hadley (see December 9, 2001, December 12, 2001, June 2002, July 2002, and June 2003), two Pentagon officials, including one who reported to then-Undersecretary of Defense for Policy Douglas Feith (see September 2002), meet with Ghorbanifar, Ledeen, and other Iranians. Hadley does not fully brief CIA Director George Tenet and Deputy Secretary of State Richard Armitage about the meetings. The head of the DIA is briefed on the meeting but is not authorized to keep a written summary of it or to discuss it on the orders of then-Deputy Defense Secretary Paul Wolfowitz. For his part, Ledeen will say he twice briefed the US ambassador to Italy about the meetings. “Any time the CIA wanted to find out what was going on all they had to do was ask,” he will say. Though the report will admit that the sources of the intelligence are unreliable, it will still criticize the Pentagon for failing to allow what it calls “potentially useful and actionable intelligence” to be shared with intelligence agencies. [Associated Press, 6/5/2008; Senate Intelligence Committee, 6/5/2008 ]

In late November 2001, State Department officials write a paper suggesting that the US has an opportunity to work with Iran to fight al-Qaeda. The CIA seconds the idea, and is willing to exchange information and coordinate border sweeps with Iran. However, neoconservatives led by Vice President Dick Cheney and Defense Secretary Donald Rumsfeld argue that the US cannot engage with Iran and other officially declared state sponsors of terrorism. In late December 2001, at a meeting of deputy cabinet officials, it is decided that the US will accept tactical information about terrorists from countries on the state sponsors list but offer nothing in return. This policy is called the “Hadley Rules” after Deputy National Security Adviser Stephen Hadley, who chairs the meeting. One month later, President Bush publicly lists Iran as part of an “Axis of Evil,” greatly reducing Iran’s cooperation regarding al-Qaeda. [Washington Post, 10/22/2004] However, the policy appears to be largely focused on Iran, as the US continues working with countries on the state sponsors list like Sudan and Syria against al-Qaeda (see June 13, 2002 and Early 2002-January 2003).

George Melloan, a deputy editor of the Wall Street Journal editorial page, calls on the Bush administration to adopt a hardline policy toward Iran. “Mr. Bush has already advised the clerics to butt out of Afghanistan. Next will come attention to Iran’s support of terrorism. It will need to start with a demand that Iran, the PLO and Hezbollah recognize Israel’s right to exist or accept the consequences of refusal.” [Wall Street Journal, 1/19/2002]

When asked why he included Iran in the “axis of evil” (see January 29, 2002), President Bush answers: “It is very important for the American president at this point in history to speak very clearly about the evils the world faces.… I believe the United States is the beacon for freedom in the world. And I believe we have a responsibility to promote freedom that is as solemn as the responsibility is to protecting the American people, because the two go hand in hand.” [Scoblic, 2008, pp. 247]

Flynt Leverett. [Source: Publicity photo]In the wake of the 9/11 attacks, Iran is supportive of US efforts to defeat the Taliban, since the Taliban and Iran have opposed each other. In 2006, Flynt Leverett, the senior director for Middle East affairs on the National Security Council in 2002 and 2003, will recall this cooperation between Iran and the US in a heavily censored New York Times editorial. Gulbuddin Hekmatyar, a notorious Afghan warlord with close ties to bin Laden (see 1984), had been living in Iran since the Taliban came to power in the 1990s. Leverett claims that in December 2001 Iran agrees to prevent Hekmatyar from returning to Afghanistan to help lead resistance to US-allied forces there, as long as the Bush administration does not criticize Iran for harboring terrorists. “But, in his January 2002 State of the Union address, President Bush did just that in labeling Iran part of the ‘axis of evil’ (see January 29, 2002). Unsurprisingly, Mr. Hekmatyar managed to leave Iran in short order after the speech.” [New York Times, 12/22/2006] Hekmatyar apparently returns to Afghanistan around February 2002. He will go on to become one of the main leaders of the armed resistance to the US-supported Afghan government. Iranian cooperation with the US over Afghanistan will continue in a more limited manner, with Iran deporting hundreds of suspected al-Qaeda and Taliban operatives who had fled Afghanistan, while apparently keeping others. But the US will end this cooperation in 2003. [BBC, 2/14/2002; USA Today, 5/21/2003; New York Times, 12/22/2006]

Israeli Defense Minister Benjamin Ben-Eliezer meets with US Vice President Dick Cheney and tells him that Israel is concerned that Iran, which Israel believes will have nuclear weapons by 2005, represents a greater threat to Israel than Iraq. “The danger, as I see it, is from a Hezbollah-Iran-Palestinian triangle, with Iran leading this triangle and putting together a coalition of terror,” he tells Cheney. [Ha'aretz, 2/9/2002]

Reuel Marc Gerecht, a resident fellow at the neoconservative American Enterprise Institute, calls on the Bush administration to adopt an aggressive policy awards Iran. He says the US must make it clear that it “favors real popular government in Iran.” There are “only two meaningful options,” he writes, “confront clerical Iran and its proxies militarily or ring it with an oil embargo.” Gerecht clearly opposes any sort of dialog with Iran’s government. “If Washington wants to dissuade and punish the clerical regime, it will have to use force, the only currency the clerics truly respect…. Starting at the periphery of the Iranian world—Lebanon and possibly Afghanistan—probably makes the most tactical and strategic sense. Lebanon, in particular, offers the United States the option of hitting three targets—Hezbollah, the clerics, and the Assad regime—at once. However, if al-Qaeda’s liaison with Iran is active, then Washington should probably take the gloves off and hit the clerical regime with enormous force.” As a start, the US should tell Iran to halt its flights to Damascus, which “supply Hezbollah in Lebanon” with arms. Some of the arms are then routed to “Palestinians in Gaza and the West Bank,” he says. They should also be warned that “any aircraft suspected of carrying military materiel will be forcibly diverted to Israel, shot down, or destroyed on the tarmac.” [Weekly Standard, 2/18/2002]

National Security Adviser Condoleezza Rice says that it is useless for the US to engage in diplomatic negotiations with Iran. “The problem with Iran,” she says, “is that its policies unfortunately belie the notion that engagement with it has helped.” [Scoblic, 2008, pp. 247]

In Paris, Defense Department officials (including either Harold Rhode or Larry Franklin) meet with Iranian officials and Manucher Ghorbanifar, an Iranian arms trader who had been a central figure in the Iran-Contra affair. The meeting reportedly resulted from “an unplanned, unscheduled encounter” that took place without White House approval. An earlier meeting involving several of the same figures had taken place seven months earlier (See December 9, 2001). [Washington Post, 8/9/2003; New York Times, 12/7/2003] When Secretary of State Colin Powell learns of the meeting, he complains directly to Condoleezza Rice and the office of Defense Secretary Donald Rumsfeld. [Newsday, 8/9/2003; Washington Post, 8/9/2003]

President Bush issues a statement strongly supporting “prodemocracy” forces in Iran, whose stated goal is to overthrow the current Iranian regime. In response, Iranian president Mohammad Khatami, considered a moderate by most Westerners, calls Bush a “warmongerer.” [Scoblic, 2008, pp. 247]

Iran’s Deputy Foreign Minister for Economic Affairs Mohammad Hossein Adeli says during a press conference that Iran has begun feasibility studies on exporting Iranian gas to India (see 1993) and is considering the possibility of transporting gas to Europe via a pipeline. He says that the Iranian government is also looking into the possibility of exporting gas to members of the Persian Gulf Cooperation Council (PGCC) and is also considering selling gas to Armenia, the south Caucasus, and the Republic of Azerbaijan. [Tehran Times, 7/9/2002]

German authorities seize a boat in the port of Hamburg containing a shipment of rubber parts—allegedly bound for Iran—that could be used to make tracks for tanks and US-made M-113 armored personnel carriers. The seized boat, the Zim Anvers, is owned by the Zim-American Israeli Shipping Company. An Israeli company, PAD, headed by Avihai Weinstein, 34, had been issued a German export license for the shipment. The license specifies Thailand as its final destination, but according to German customs, the shipment is really destined for Iran. According to the Israeli daily Yediot Aharonot, it was to be transferred in Hamburg to an Iranian cargo ship headed to the southern Iranian port of Bandar Abbas. Weinstein claims he had no knowledge of the shipment’s actual destination. Raphael Eitan, an adviser on terrorism for several Israeli governments between 1978 and 1985, tells public radio the next day that it would have been impossible for Weinstein “not to know what the final destination of the shipment was. In this type of affair, there is no innocent contract. He knew the shipment was headed to Iran,” he says. Tehran denies any involvement with the boat. [Agence France-Presse, 3/29/2002]

Mohamed ElBaradei, the president of the International Atomic Energy Agency (IAEA), meets with President Bush in the Oval Office to discuss the news of Iran’s restarted nuclear program (see August 2002 and December 12, 2002). ElBaradei tells Bush that the Iranians want to meet with an American delegation to discuss the program, obviously with the intent of negotiating a cessation in return for American concessions. ElBaradei offers to help set up the talks, and even keep them low-profile. But Bush is uninterested. His goal, as he later tells British Prime Minister Tony Blair, is to “free Iran.” Author J. Peter Scoblic will later write that any negotiations that might succeed in shutting down Iran’s nuclear program would also serve to strengthen and legitimize Iran’s government; it is, therefore, worth the risk of a nuclear Iran to continue working towards “regime change” in that nation. This also helps explain why, several months later, Bush officials refused to consider Iran’s offer of the so-called “grand bargain” (see May 4, 2003). [Scoblic, 2008, pp. 247]

Neoconservative Michael Ledeen recommends that the US invade Iraq—but only after invading Iran and overthrowing that nation’s government. Ledeen claims that the sporadic demonstrations by Iranian dissidents prove that the entire nation is just waiting for someone like the US to come in and get rid of the theocratic Iranian “mullahcracy” and replace it with a Western-style democracy. Ledeen writes: “This is yet another test of the courage and coherence of American leaders. President Bush has been outstanding in endorsing the calls for freedom in Iran, as has Defense Secretary Rumsfeld. It would be nice if Secretary of State Powell added his own eloquence to the chorus, especially because many Iranians fear that the State Department is still trying to cut a deal with the mullahs. I have long argued that it would be better to liberate Iran before Iraq, and events may soon give us that opportunity. Let’s hope our national security team recognizes how wonderful an opportunity it is, and therefore gives the Iranian freedom fighters the assistance they so richly deserve. Faster, please. Opportunity is knocking at our door.” [National Review, 11/12/2002]

Trade between China and Iran increases by 50 percent. China is a major exporter of manufactured goods to Iran, including computer systems, household appliances, and automobiles. The growth of Chinese-Iranian trade has undermined the effectiveness of US sanctions against companies doing business with Iran, which the Bush administration claims is pursuing the development of nuclear weapons and has ties to terrorist organizations. “Sanctions are not effective nowadays because we have many options in secondary markets, like China,” Hossein Shariatmadari, a leading conservative Iranian theorist and editor of the Kayhan newspapers, will tell the Washington Post in 2005. [Washington Post, 11/17/2004]

Iranian political leader Mohammad Khatami reveals that Iran has begun building two nuclear processing plants devoted to enriching uranium. The head of the International Atomic Energy Agency (IAEA), Mohamed ElBaradei, later says that one of the Iranian plants is already near completion and a second plant is well underway. Although Iran claims that the nuclear plants are strictly for peaceful energy creation, the Bush administration believes that the Iranians have used the cover of practices not strictly forbidden by the Nuclear Nonproliferation Treaty (see July 1, 1968) to hide a nuclear weapons program. One Bush official says that if the Iranians run the Bushehr reactor (see December 12, 2002) for five or six years, withdraw from the Nonproliferation Treaty, just as North Korea has done (see January 10, 2003 and After), and reprocess all of their radioactive material, they would have enough weapons-grade uranium and/or plutonium to build as many as a hundred nuclear weapons. Bush officials hope that a combination of pressure from Russia and the US occupation of neighboring Iraq—one senior Bush official says, “I think the presence of 200,000 American troops on their border for X period of time may tend to concentrate their attention”—may keep Iran’s nuclear program under restraint. [New York Times, 5/4/2003]

Representative Curt Weldon. [Source: H. Rumph Jr / Associated Press]Congressman Curt Weldon (R-PA) becomes embroiled in a plot by Iranian arms dealer Manucher Ghorbanifar to contrive a secret uranium exchange between Iran and Iraq. According to Ghorbanifar’s story (see January 11, 2006), just before the March 2003 invasion of Iraq, a team of Iranian intelligence agents infiltrated Iraq and stole enriched uranium for use in Iran’s nuclear weapons program. The story is later proven to be false, and based on a desire for money and to embroil Iran and Iraq in a spurious WMD plot. After first being contacted by a mysterious Iranian source through a friend and a colleage on March 7, Weldon repeatedly flies to Paris to meet with the source he later calls “Ali,” who is later shown to be Fereidoun Mahdavi, a former minister in the Shah’s Iran who now works as a secretary for Ghorbanifar. Mahdavi has already tried, and failed, to interest several Western intelligence agencies in the stolen uranium tale. He finds Weldon to be far more credulous than the intelligence agencies. According to an intelligence source interviewed in 2006, “Ali provided information that indicated Iranian intelligence had sent a team to Baghdad to extract highly enriched uranium from a stockpile hidden by Saddam Hussein.” Ali tells Weldon that an Iranian intelligence team infiltrated Iraq and stole the uranium for Iran’s nuclear weapons program. According to the story, “the team successfully extracted the stockpile but on the way back to Iran contracted radiation poisoning.” Weldon immediately informs CIA Director George Tenet. Weldon will later write in his book Countdown to Terror: “Tenet appeared interested, even enthusiastic about evaluating Ali and establishing a working relationship with him. He agreed to send his top spy, Stephen Kappes, the deputy director of operations, along with me to Paris for another debriefing of Ali.… On the day of our scheduled second meeting with Ali in Paris, Kappes bowed out, claiming that ‘other commitments’ compelled him to cancel. Later, the CIA claimed to have met with Ali independently. But I discovered this to be untrue.… Incredibly, I learned that the CIA had apparently asked French intelligence to silence Ali.” Weldon is wrong; the CIA’s Paris station chief, Bill Murray, investigates the claims and finds Ghorbanifar (whom either he or the agency mistakenly believes to be “Ali”) to be what the agency calls a “fabricator.” Murray goes so far as to take either Ghorbanifar or Mahdavi to Iraq to have them retrace the route of the Iranian intelligence mission. “Ali” is unable to do so, and Murray learns that the entire story was concocted in hopes of a large payoff: “Soon it became apparent that Ali and his sources were fabricators and were trying to extract large sums of money,” one intelligence source will say. (Murray will later deny going to Iraq with either Ghorbanifar or Mahdavi, but will call “the source” “not credible.… The sensational charges that the source made could not be substantiated.” Weldon, not to be denied, takes his story to Defense Secretary Donald Rumsfeld, who pressures the CIA to investigate further. One former CIA officer later says, “CIA reluctantly, after pressure from Rumsfeld, followed up by detaching one of their weapons experts from the team that was hunting WMD in Iraq.” Again, this effort proves that Ghorbanifar’s story is completely false. In 2006, reporter Larisa Alexandrovna will call Weldon an “innocent bystander taken in by an internationally known con man and the lure of spook-like activities than an inside player with an agenda or material participant in these events. The Ali composite seems to have used Weldon as a conduit by which to provide the CIA with information.” One intelligence official will observe, “If you were going to launder intel to make up a war, you could easily send some fool on an errand.” [Raw Story, 1/11/2006] Weldon will meet again with Mahdavi, and will write about a lurid Iranian terror plot, the “12th Imam” scheme, based on his tales (see June 8, 2005 and Mid-July 2005). He will claim that the CIA has “routinely” ignored “credible” information about these and other plots.

Trade between Iraq and Iran grows at an estimated annual rate of 30 percent after the US and British invasion. “The economies of Iraq and Iran, the largest Shiite-majority countries in the world, are becoming closely integrated, with Iranian goods flooding Iraqi markets and Iraqi cities looking to Iran for basic services,” the New York Times will report in early 2007. After the invasion, Iraq begins importing electricity and a wide variety of consumer items like Peugeot sedans, carpets, construction materials, fish, and spices. Iraqis are also going to Iran to obtain medical services. Trade between the two nations grows the fastest in the Shiite-dominated south. By 2007, Basra is importing $45 million worth of goods from Iran each year with some 100 to 150 commercial trucks crossing into Iraq from Iran each day. The trend causes concern in the White House, which accuses Iran of having a nuclear weapons program and claims that the Iranians are fueling the insurgency. According to Asaad Abu Galal, the governor of Najaf, “the Americans don’t want to bring Iranians to Najaf. The Americans want to control the sky.” Iranians are also vying for a market in the financial sector, with at least one bank applying for a license to open a branch in Baghdad. [New York Times, 3/17/2007]

Britain’s Daily Telegraph newspaper notes that with the construction of proposed US bases in Iraq, Iran would be surrounded. “[T]heir proximity to Syria and Iran could help the US to apply added pressure on those countries,” the paper says. “With US troops also stationed in Afghanistan, Iran is now almost surrounded by American forces.” [Daily Telegraph, 4/21/2003]

Two weeks after the White House flatly rejected a comprehensive diplomatic offer from Iran (see May 4, 2003), Secretary of State Colin Powell approaches State Department official Hillary Mann, who wrote the original memo recommending that the Iranian proffer be considered. Powell tells Mann: “It was a very good memo. I couldn’t sell it at the White House.” [Esquire, 10/18/2007]

The US Department of State releases its annual “Patterns of Global Terrorism” report. Included in its list of terrorist organizations is the Mujahedeen-e Khalq (MEK), an Iranian opposition group in Iraq that has offices in Washington, DC. The report notes that the MEK helped Saddam Hussein during Iraq’s war with Iran and assisted the dictator in suppressing the Shia uprisings in southern Iraq and the Kurdish uprisings in the north after the first Gulf War. [US Department of State, 4/30/2003] During a press briefing that coincides with the release of the report, US Ambassador Cofer Black, Coordinator for Counterterrorism in the US State Department, is asked to explain why the US has permitted MEK to have an office in Washington. “The Secretary has recommended that the president determine that the laws that apply to countries that support terrorism no longer apply to Iraq,” Black explains. “The president’s determination to provide greater flexibility in permitting certain types of trade with and assistance to Iraq; thus, we can treat Iraq like any other country not on the terrorist list.” He insists that the “United States Government does not negotiate with terrorists,” but contends that MEK “is a pretty special group” and that the US considers the agreement as a “prelude to the group’s surrender.” [US Department of State, 4/30/2003]

The Bush administration blames Iran for helping al-Qaeda bomb three foreign worker compounds in Riyadh, Saudi Arabia (see May 12, 2003). Though the US has no evidence of Iranian complicity in the bombings, Defense Secretary Donald Rumsfeld and Vice President Dick Cheney insist that Iran must have been involved, and prevail upon President Bush to shut down the informal backchannel discussions between Iranian and US officials (see September 11, 2001). [Scoblic, 2008, pp. 249]

CNN reports that despite US government prohibitions (see March 15, 1995 and May 6, 1995) banning US citizens and business from doing business with Iran, dozens of US companies are actively conducting business there, including Halliburton, ConocoPhillips and General Electric. The companies are using a complicated array of corporate loop-holes and off-shore accounts to maneuver around US laws. Michael Ledeen, interviewed by CNN, says these companies are aiding terrorism. “The oil companies are a wholly owned subsidiary of the government… the government is the primary sponsor of terrorism,” he says, additionally claiming that “they have separate organizations that are used to funnel oil profits and other profits into the terror network.” [CNN, 2/10/2003; CNN, 5/29/2003]

Instead of considering Iran’s sweeping proposal to open diplomatic negotiations with the United States (see May 4, 2003), the Bush administration begins working on efforts to destabilize the Iranian government (see November 12, 2002, May 6, 2003, and May 19, 2003). Former National Security Council official Flynt Leverett says he believes the White House’s course is a dangerous one: “What it means is we will end up with an Iran that has nuclear weapons and no dialogue with the United States.” [Esquire, 10/18/2007]

Humayun Khan (no relation to nuclear scientist A. Q. Khan) of Pakistan e-mails Israeli electronics expert Asher Karni, who is living in South Africa, with a request to purchase 200 dual purpose US-manufactured triggered spark gaps. Such devices are typically used in high-tech medical machines to break up kidney stones, but they can also be used to detonate a nuclear weapon. Khan asks Karni not to reveal that the end destination is Pakistan. Karni responds a few days later, informing Khan that he cannot fulfill the order because the US government would require an expert license for the deal. “I know it is difficult, but that’s how we came to know each other,” Khan replies. “Please help to negotiate this from any other source.” Nine hours later, Karni responds in another email: “Will do.” Karni places the order, indicating that the destination is Baragwanath Hospital in Soweto, South Africa. According to US special agent John McKenna, the emails are intercepted by an informant in South Africa who promptly forwards them to the US Commerce Department. [Mother Jones, 5/2005; PBS, 7/27/2005]

Five of the six members of the Shanghai Cooperation Organization (SCO) conduct their first ever military exercises together. Experts say the joint-maneuvers demonstrate how important the SCO is to China in its effort to counter the growing US military presence in Central Asia. Alex Vatanka, of the London based Jane’s Intelligence, suggests the point of the exercises is to show the Central Asian states what China can offer as a partner that the US cannot. [Radio Free Europe, 8/5/2003]

France, Germany, and Britain succeed in persuading Iran to suspend its uranium enrichment activities, cooperate with the International Atomic Energy Agency (IAEA), and permit intrusive inspections by United Nations monitors. The US refuses to join this effort, and continues to attempt to have Iran referred to the UN Security Council for violating its safeguard agreements. Unable to affect the negotiations between Iran and the Europeans, Bush officials are reduced to mocking the negotiations, with the State Department’s John Bolton asking, “How many IAEA meetings does it take to screw in a lightbulb?” Bolton is later asked what he thinks about the Europeans’ “carrot-and-stick” methodology of negotiating with the Iranians, and he replies, “I don’t do carrots.” Author J. Peter Scoblic later writes: “The problem was that the administration didn’t really do sticks, either. Although the Bush administration repeatedly made it clear that ‘all options were on the table,’ it never explicitly threatened military action or established red lines beyond which it would force Iran to pay some explicit price. Absent coercion or diplomacy, the Bush administration’s strategy was essentially one of hope—hope that the Iranian regime would collapse, yielding morally pure victory. Unfortunately, just as with North Korea (see May 4, 2003), dramatic change was unlikely; not only was the regime relatively stable, but Iranian reformers appeared committed to the nuclear program as well.” [Scoblic, 2008, pp. 249-250]

Mohamed ElBaradei, the president of the International Atomic Energy Agency (IAEA), meets with Secretary of State Colin Powell to ask a second time for the US’s participation in European-led negotiations with Iran over that nation’s nuclear program (see Fall 2003). Powell refuses. The IAEA and the Europeans—France, Germany, and Britain—believe that the US’s participation in the negotiations is essential to convince Iran to make real concessions. Iran wants assurances that the US will not attack it. Moreover, Iran knows that the Europeans will wait for US approval for any incentives they offer, such as membership in the World Trade Organization (WTO). During the negotiations, an Iranian diplomat tells British negotiator John Sawers not to keep pressing the Iranian delegation to give up its nuclear weapons development program: “Look, John, that’s what we are saving up for the Americans. We can’t spend all our possible concessions in negotiating with you. We’ll have nothing left.” As the Europeans continue to jockey with the balky Iranians, the US continues to stand apart—“leaving the driving to the EU,” as State Department neoconservative John Bolton will later comment. Only in 2005 will the Bush administration begin giving its grudging support to the negotiations, but it will continue to refuse to actually participate in them. [Scoblic, 2008, pp. 249-250]

Ahmed Chalabi, a member of Iraq’s governing council, meets with the Baghdad station chief for Iran’s Ministry of Intelligence and Security and informs him that the US has broken the code used to encrypt Iran’s intelligence communications. Chalabi says that he learned about the code-break from a drunken American official. A frantic exchange of communications takes place between the Iranian agent and Tehran concerning Chalabi’s claim. The US intercepts and decodes all of them, revealing Chalabi’s role. When the story is broken in the press, Chalabi denies having passed classified information to the Iranians. [Newsweek, 5/10/2004; New York Times, 6/2/2004; CBS News, 6/3/2004; News Insight, 6/9/2004]

The Shanghai Cooperation Organization (SCO) holds its summit in Tashkent, Uzbekistan. [People's Republic of China, 9/17/2004; GlobalSecurity (.org), 7/4/2005] SCO members agree to form the Regional Antiterrorism Structure (RATS), a concept originally conceived in 2002 to encourage the exchange of information and to facilitate improved border coordination between members. Mongolia receives observer status at this summit, paving the way for future membership [GlobalSecurity (.org), 7/4/2005] , and Pakistan, India, and Iran are considered for possible future membership (see June 6, 2005). [Yom, 2002]

China and Iran negotiate a $70-$100 billion deal that gives China’s state oil company a 51 percent stake in Iran’s Yadavaran oil field, located near the Iraq border. The Yadavaran oil field, once thought to be two separate oil fields (Koushk and Hosseinieh), contains more than 3 billion barrels of recoverable oil and a total reserve of 17 billion barrels. [China Daily, 11/8/2004; Washington Post, 11/17/2004] China agrees to purchase ten million tons of liquefied natural gas (LNG) annually for a 25-year period once Iran has constructed plants to liquefy the natural gas, a feat that could take more than five years. The amount could increase to as much as $200 billion if an oil deal, currently under negotiation, is also agreed upon by the two nations. [Persian Journal, 10/31/2004] As part of the deal, Sinopec, China’s state oil company, will have the right to exploit Iran’s Yadavaran oil field, located near the Iraq border, on a buy-back basis in cooperation with another major international oil company. The Yadavaran oil field contains more than 3 billion barrels of exploitable reserves and comprises the Koushk and Hosseinieh oil fields, “which were recently found to be connected at various layers, forming an oil field with a cumulative in-place reserve of 17 billion barrels,” the Chinese Daily reports. [China Daily, 11/8/2004] Iran is estimated to have a 26.6-trillion-cubic-meter gas reservoir, the second-largest in the world. About half of its reserves are located offshore. Some observers suggest that the Iran-China agreement could establish a precedent that opens the way for other nations to do business with Iran. The US Iran-Libya Sanctions Act of 1996 (ILSA), which penalizes foreign companies for investing more than $20 million in Iran’s oil and gas industry, has so far discouraged many companies from doing a large amount of business with the Islamic state. [Asia Times, 11/6/2005] Additionally, the Iran-China deal dramatically reduces the Bush administration’s leverage over Iran, as its threat to bring Iran to the UN Security Council over its nuclear program is greatly weakened by the fact that China, as a permanent member, holds a veto at the council. [Washington Post, 11/17/2004]

An Iranian exile group says it has evidence that Iran is still enriching uranium and will continue to do so despite an agreement it signed pledging it to halt such activities. The group, the National Council of Resistance in Iran (NCRI), the political arm of the Mujahedeen-e Khalq (MEK), also charges that in the mid-1990s, Iran bought the plans for a Chinese nuclear bomb from the global nuclear technology network led by Pakistan’s A. Q. Khan. Khan’s network sold the same type of bomb blueprint to Libya, which has renounced its nuclear ambitions (see December 2003). The NCRI’s Mohammed Mohaddessin says the Khan network also provided Iran with a small amount of highly enriched uranium, though the amount is too small to use for a weapon. While the NCRI provided information in 2002 that helped disclose Iran’s secret nuclear program, many of its subsequent allegations have been proven false. Claims - Mohaddessin uses satellite photos to show what he says is a new nuclear facility inside Tehran’s Center for the Development of Advanced Defense Technology (CDADT). He says that the CDADT also houses chemical and biological weapons programs, and that Iran began enriching uranium at the site in early 2003. Mohaddessin refuses to provide any evidence for his claims, instead saying, “Our sources were 100 percent sure about their intelligence.” Those sources, he says, are scientists and other people working in the facilities, and local citizens living near the facilities who see what he calls suspicious activities. Reaction - Many diplomats and arms control experts dismiss the NCRI’s claims, saying the claims are an attempt to undermine the recent agreement Tehran signed with Britain, France, and Germany to restrict its uranium enrichment program. In return, the agreement says, Iran can continue working on developing nuclear technology for peaceful purposes. [Washington Post, 11/18/2004]

James Dobbins. [Source: PBS]James Dobbins, director of the International Security and Defense Policy Center at the RAND Corporation, writes an analytical piece on the subject of engagement with Iran: “Washington is not ready to join the Europeans in negotiating limits on Iran’s program, nor is it willing to offer any incentives. Conversely, the United States cannot threaten Iran with political isolation or economic sanctions because America already has in place a comprehensive economic embargo and blackout on communication.” Dobbins adds that “America has refused to negotiate, to offer concessions or to join in multilateral economic and political arrangements that its European allies may negotiate…. [W]hile Europe offers carrots, Washington brandishes no sticks. Given American difficulties in Iraq, a military invasion of Iran is implausible. An aerial attack on known nuclear sites in Iran might slow that country’s weapons program, but only at the cost of accelerated efforts at clandestine sites…. Washington is no more than an excited bystander offering advice from a safe distance.” In conclusion, Dobbins states that: “If blocking Iran’s nuclear weapons aspirations is as urgent as it would seem, then engagement on that issue is imperative. At present, nothing Iran does or fails to do will alter the American posture. This unyielding attitude undercuts the prospects for Europe’s effort to negotiate a positive resolution to the nuclear crisis. It also provides the weakest possible basis for common action in the absence of such a settlement.” [International Herald Tribune, 12/2/2004]

In Delhi, the India government hosts the first-ever round-table of Asian oil ministers from the Persian Gulf, China and Southeast Asia. Iranian Oil Minister Bijan Namdar Zanghaneh recommends creating an Asian Bank for Energy Development to finance energy projects in Asia, such as the long-proposed Iran-Pakistan-India gas pipeline project (see 1993). He also calls for lower prices for Asian energy supplies that are sold to Asian consumers. [Asia Times, 1/11/2005; World Peace Herald, 1/17/2005]

India announces that it has agreed to a $40 billion deal with Iran. Under the terms of the agreement, the National Iranian Oil Company (NIOC) will sell 5 million tons of liquefied natural gas (LNG) annually to India over a 25-year period with the possibility of increasing the quantity to 7.5 million tons. India’s price will be computed at 0.065 of Brent crude average plus $1.2 with an upper ceiling of $31 per barrel. As part of the deal, India’s ONGC Videsh Ltd (OVL) will participate in the development of Yadavaran, Iran’s largest oil field. India’s share in the oil field will be 20 percent, which translates into roughly 60,000 barrels per day of oil. Iran has retained a 30 percent stake while the Chinese state oil company Sinopec secured a 50 percent share in an agreement signed at the end of October (see October 29, 2004). India’s deal with Iran will also provide India with 100 percent of the rights in the 300,000-barrel-per-day Jufeir oilfield. [Asia Times, 1/11/2005; World Peace Herald, 1/17/2005] The agreement could give new impetus to the long proposed Iran-Pakistan-India gas pipeline project (see 1993). The Tehran Times, which is known to represent the views of the Iranian government, comments, “The Iran-India agreement on LNG exports will pave the way for the implementation of the project to pipe Iranian gas to India via Pakistan and the dream of the peace pipeline could become a reality in the near future.” [Asia Times, 1/11/2005]

Iran and Russia agree to work jointly on the design and launch of the first Iranian communications satellite, Zohre, at a cost of $132 million. One of the signers to the agreement, Felix Myasnikov, the general director of the Aviaexport, says he believes “that the contract will be a starting point for Russian-Iranian cooperation in space exploration as well as in other spheres of high technologies, in particular, in the aircraft industry.” [Islamic Republic News Agency, 1/31/2005]

Two thousand Austrian Steyr Mannlicher GmbH high-powered armor-piercing sniper rifles are delivered to Iran, to be used as part of Iran’s effort to clamp down on the drug smugglers pouring in across the border from Afghanistan. The weapons deal, approved by Austria in November 2004, is opposed by the US, which expressed concerns that the weapons could ultimately be used against US soldiers in Iraq, Afghanistan, and potentially Iran. [Associated Press, 3/26/2005; Arms Technology, 4/4/2005]

Alexander Rumyantsev, head of Russia’s Federal Atomic Energy Agency, and Iranian Vice President Gholamreza Aghazadeh sign a nuclear fuel supply deal. Under the provisions of the agreement, Russia will supply Iran with uranium fuel for Iran’s Russian-built Bushehr nuclear power plant, which once complete will produce 1,000 megawatts of electricity. Iran will be required to return all of the spent fuel to Russia to prevent the possibility that some of it will be used to produce bomb-grade plutonium. According to Rumyantsev, the first batch of enriched uranium fuel is waiting in Siberia ready to be shipped. [Reuters, 2/27/2005; Los Angeles Times, 3/1/2005] Russia’s more than $1 billion contract to build the reactor is said to have played a significant role in maintaining the strength of Russia’s nuclear energy industry. Russia, which has sent more than 2,000 workers to work with 3,000 Iranians at Bushehr, is keen on securing more contracts with the Iranian government. An additional 1,500 Russian specialists are scheduled to go to Bushehr soon to install more equipment. [Los Angeles Times, 3/1/2005]

US ambassador to New Delhi David Mulford informs India’s Oil Minister Mani Shankar Aiyar in a meeting that the Bush administration has reservations about Indian attempts to strike a deal with Iran on the long proposed $3-4 billion Iran-Pakistan-India gas-pipeline project (see 1993). According to the Indian Express, the meeting marks the first time the US has formally conveyed its concerns about the pipeline proposal. [Agence France-Presse, 3/10/2005; Dawn (Karachi), 3/11/2005; Voice of America, 3/17/2005]

Iran’s chief nuclear negotiator, Hassan Rohani, says the Middle East will become even more unstable if Iran is sent to the UN Security Council over its nuclear program. “This would be a particular problem for the United States because it has a lot of troops and equipment in [the] region and is in fact our imposed neighbor,” he says. Iran has complained that United States forces have effectively encircled it, with troops stationed in both Iraq and Afghanistan. [Al Jazeera, 3/5/2005]

Iranian Oil Minister Bijan Namdar Zanganeh signs a memorandum of understanding with his Indonesian counterpart Purnomo Yusgiantoro that Iran will build a $3 billion refinery in Indonesia. As part of the deal, Indonesia will receive 300,000 barrels per day of heavy crude and Tehran will get a 30 percent stake in PT Pertamina, Indonesia’s state oil company. National Iranian Oil Company and Pertamina will lead the four-year project, which Iran hopes will provide security for Iran’s market supply. [Islamic Republic News Agency, 3/16/2005; Bloomberg, 3/18/2005]

Iranian President Mohammad Khatami personally accompanies about 30 journalists deep into the underground nuclear plant at Natanz, a uranium enrichment facility located 250 km (150 miles) south of Tehran. The group of foreign and local journalists is permitted to film and take video footage of the complex. Natanz is built more than 18 meters (54 feet) below ground due to “security problems.” The journalists are shown another facility in the city of Isfahan. “If we were looking to make atomic weapons, we could have completed these [facilities] in hiding,” Khatami tells the reporters. The gesture is viewed by many as an attempt to undermine support for a possible aerial attack by the United States or Israel. [Reuters, 3/30/2005]

Rumors spread in the Arab-dominated western Iranian city of Ahwaz that the government is considering the forced migration of Arabs to Iran’s northern provinces. The rumors are based on a letter purportedly written by Iran’s vice president, Muhammad Ali Abtahi. [Al Jazeera, 4/17/2005; BBC, 4/19/2005] The Iranian government claims the letter was fabricated by “foreign agents,” and aimed at exploiting ethnic tensions to create civil unrest. [Xinhua News Agency (Beijing), 5/26/2005] The Popular Democratic Front of Ahwazi Arabs in Iran, however, insists the letter is authentic and represents the regime’s long-standing objective to forcibly relocate Arabs. The controversial letter results in clashes between police and ethnic Arabs in Ahwaz. Although Arabs dominate Ahwaz, they account for only three percent of Iran’s total population. [Al Jazeera, 4/17/2005; BBC, 4/19/2005]

Asian News International reports that according to official Pakistani sources the US government is reconsidering its opposition to the $4.2 billion dollar Iran-Pakistan-India gas pipeline (see 1993). The Bush administration has been opposed to the proposed pipeline on grounds that it would help Iran, a potential target of future US military strikes. But since the consortium is hoping to involve US corporations, these companies are apparently putting pressure on the White House to back the pipeline. Without the approval of the US government, the companies would be barred from participating in the pipeline’s construction. According to sources, the US is considering pursuing a strategy that would leverage its possible support for the pipeline against Iran in its disagreement over the country’s nuclear program. [News (Islamabad), 4/2/2005]

The Bush administration announces plans to spend $3 million on supporting “the advancement of democracy and human rights” in Iran. The State Department’s Bureau of Democracy, Human Rights, and Labor says it expects to award between three and 12 grants ranging from $250,000 to $1 million to educational institutions, humanitarian groups, nongovernmental organizations, and individuals. [US Department of State, 4/8/2005; Associated Press, 4/11/2005] Iran’s ambassador to the United Nations, Mohammad Javad Zarif, says the plan is “a clear violation” of the 1981 Algiers Accords which prohibits the US from intervening “directly or indirectly, politically or militarily in Iran’s internal affairs.” [Islamic Republic News Agency, 4/11/2005]

Leslie Gelb, president of the Council on Foreign Relations (CFR), returns from a trip to Iraq and complains that Washington is exhibiting a “totally unrealistic optimism” about events in that country. Gelb, a former Pentagon official, also says in his report that the US military is preparing Iraqis for a future war with Iran. “It became very apparent to me that these 10 divisions were to fight some future war against Iran. It had nothing to do—nothing to do—with taking that country over from us and fighting the insurgents,” Gelb concludes. [Gelb, 4/26/2005; Boston Globe, 6/17/2005]

The foreign ministers of Britain, France, and Germany write to Hassan Rouhani, head of Iran’s Supreme Security Council, warning that they will end negotiations with the Iranian government if it resumes its nuclear energy program. The letter marks the first time European countries have threatened to sign on to the Bush administration’s hardline strategy in dealing with Iran. [Washington Post, 5/12/2005]

UN Secretary-General Kofi Annan warns the US that the Security Council would probably deadlock on any resolution to levy sanctions against Iran for its refusal to halt its nuclear energy program. The US and Britain have been urging that Iran be brought before the Security Council if it does not give up its program. In an interview with USA Today, Annan explains that both China and Russia, with their close ties to Iran, would certainly veto any proposal to impose sanctions. [USA Today, 5/15/2005]

The governments of Iran and Azerbaijan sign a non-aggression pact agreeing that neither government will allow a third state to set up a military base on its soil in order to launch military strikes on the other. [Islamic Republic News Agency, 5/16/2005]

India’s Ministry of External Affairs, known as South Block, produces a report on the potential legal implications of going ahead with the long-proposed $4.3 billion Iran-Pakistan-India gas-pipeline project (see 1993). The report warns that India could get slapped with sanctions by the US under the Iran and Libya Sanctions Act of 1996. South Block says activities that lead to annual investments of over $40 million and directly increase Iran’s ability to develop its oil and gas resources may trigger sanctions from the US. But South Block also notes in its report that Turkey, Britain, the Netherlands, and Japan all invested in Iran’s hydrocarbon sector after the Act went into force and did not attract sanctions. The European Union and Canada have both challenged the law and Iran has called the law “inadmissible intervention in its internal and external affairs.” [US Congress, 8/5/1996; Indian Express, 5/21/2005]

The $4 billion US-backed Baku-Tbilisi-Ceyhan (BTC) pipeline officially opens. The pipeline begins in Baku, Azerbaijan and travels 1,762 km (1,000 miles) through Georgia to the Mediterranean port city of Ceyhan in Turkey. The pipeline has been under construction for ten years and was built by a consortium of oil companies including Amerada Hess, ConocoPhillips, Eni, Inpex, Itochu, Statoil, Total, SOCAR, TPAO, Unocal, and BP. The pipeline is expected to bring one million barrels of oil per day to the West. [Institution, 3/4/2003; BBC, 5/5/2005; BBC, 5/25/2005]

Iran’s information minister, Ali Younesi, accuses the US of pursuing a policy of regime change in Iran by exploiting ethnic and racial tension. One month before, the Iranian government claimed that “foreign agents” were behind an April letter (see Early April 2005) purportedly written by Iran’s former vice president, Muhammad Ali Abtahi, promoting the forced relocation of Iranian Arabs to the country’s northern provinces. Also that month, Washington earmarked $3 million to “promote democracy in Iran” (see April 11, 2005), a move criticized by Tehran as interfering in Iran’s internal affairs. [Xinhua News Agency (Beijing), 5/26/2005]

The London Times reports that according to a senior insurgent commander in Iraq, injured Jordanian militant Abu Musab al-Zarqawi has fled Iraq, possibly to Iran. Zarqawi has claimed responsibility for numerous bombings, assassination, and beheadings across Iraq since the fall of Saddam Hussein in March 2003. According to the insurgent commander, al-Zarqawi’s convoy was attacked as they were escaping an American offensive near the town of al-Qaim in northwestern Iraq in early April. [Sunday Times (London), 5/29/2005] Iranian Foreign Ministry spokesperson Hamid Reza Asefi dismisses the report as “amateur newsmaking.” [Associated Press, 5/29/2005]

Christopher Brown of the Hudson Institute writes that the Shanghai Cooperation Organization (SCO) is “perhaps the most dangerous organization that the American people have never heard of.” Brown asserts that the SCO’s publicly stated goals, including fighting terrorism, are a sham. He writes that the SCO is the most obvious but most ignored challenge to the US and warns that the potential future inclusion of Iran into the organization could lead to weapons proliferation. He reasons that “since one of the programs of the SCO is the linking of the road systems in the region,” the transportation of dangerous goods between Iran and China would increase dramatically. [FrontPage Magazine, 5/30/2005]

Iran announces it has successfully tested a new solid-fuel missile motor for use in its Shahab-3 missiles. A Shahab-3 missile using solid-fuel has a range of 2,000 km (1,280 miles) compared to the standard Shahab 3 with a range of only 1,500 km (930 miles), putting US regional military bases and Israel within reach. The Shahab-3 can be configured as a two-stage missile equipped with a warhead. Solid fuel engines make ballistic missiles more accurate and improve deployment time. [Federation of American Scientists, 4/6/2005; New York Times, 6/1/2005; Ha'aretz, 6/1/2005]

Jephraim P. Gundzik, president of the investment firm Condor Advisers, Inc., writes in the Asia Times that George Bush’s unilateralist foreign policy has spurred “monumental changes in the world’s geostrategic alliances.” Chief among these “is the formation of a new triangle comprised of China, Iran, and Russia,” he notes. “To China and Russia, Washington’s ‘democratic reform program’ is a thinly disguised method for the US to militarily dispose of unfriendly regimes in order to ensure the country’s primacy as the world’s sole superpower. The China-Iran-Russia alliance can be considered as Beijing’s and Moscow’s counterpunch to Washington’s global ambitions. From this perspective, Iran is integral to thwarting the Bush administration’s foreign policy goals. This is precisely why Beijing and Moscow have strengthened their economic and diplomatic ties with Tehran. It is also why Beijing and Moscow are providing Tehran with increasingly sophisticated weapons.” [Asia Times, 6/4/2005]

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